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Field
Abstract
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Before
This study investigates the evolving landscape of carbon offsetting and consumer preferences. While carbon offsetting alone cannot fully address the climate crisis, its impact remains significant. The global offsetting market has seen rapid growth, reaching a value of $2 billion in 2021. Nevertheless, offsets from the voluntary carbon market are associated with considerable permanence uncertainties, casting doubt on their long-term climate impact and their contribution to net-zero goals. These concerns are particularly salient for nature-based offsets, such as forestry projects, given the risks associated with natural hazards and land-use changes. At the same time, nature-based offsets are offered at relatively low costs and provide a range of valuable co-benefits, making them 'charismatic carbon' offsets, and therefore particularly appealing to consumers. To explore individual preferences in carbon offsetting, this study employs an incentivized framed-field experiment. We aim to understand how consumers assess the importance of prices, permanence, and co-benefits when making offsetting decisions. First, I investigate subjective beliefs about the permanence and co-benefits of available offsetting options, addressing potential knowledge gaps and misconceptions among consumers. Second, I examine the trade-offs between permanence concerns, co-benefits, and prices. Finally, I explore whether providing information about the permanence issues associated with offsets affects their perceived market value.
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After
This study investigates the evolving landscape of carbon offsetting and consumer preferences. While carbon offsetting alone cannot fully address the climate crisis, its impact remains significant. The global offsetting market has seen rapid growth, reaching a value of $2 billion in 2021. Nevertheless, offsets from the voluntary carbon market are associated with considerable permanence uncertainties, casting doubt on their long-term climate impact and their contribution to net-zero goals. These concerns are particularly salient for nature-based offsets, such as forestry projects, given the risks associated with natural hazards and land-use changes. At the same time, nature-based offsets are offered at relatively low costs and provide a range of valuable co-benefits, making them 'charismatic carbon' offsets, and therefore particularly appealing to consumers. To explore individual preferences in carbon offsetting, this study employs an incentivized framed-field experiment. We aim to understand how consumers assess the importance of prices, permanence, and co-benefits when making offsetting decisions. First, I investigate subjective beliefs about the permanence and co-benefits of available offsetting options, addressing potential knowledge gaps and misconceptions among consumers. Second, I explore whether providing information about the permanence issues associated with offsets affects their perceived market value.
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Field
Last Published
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Before
October 23, 2023 09:29 AM
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After
January 15, 2024 05:12 AM
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Experimental Design (Public)
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Before
Participants answer four Willingness to Pay (WTP) questions and are asked to allocate an amount of money between themselves and carbon offsetting. The first three WTP questions are designed to explore how concerns about permanence are traded off against co-benefits and prices. Participants receive three different sets of information about an unspecified offset (following a vignette design), with variations along three key dimensions: i) the price to offset one ton of CO2, ii) the permanence of the offset, and iii) additional co-benefits. For each of these three sets of information, they decide whether they want to use that option to offset or keep the 30€ for themselves. The fourth WTP question is designed to investigate whether providing information about the permanence issues of offsets alters their market value. Participants can again allocate the 30€ between themselves and offsetting, but this time, the offset project is specified. This last WTP question is presented under four different treatments that provide different information about the permanence and the co-benefits of the specified offset project.
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After
Participants answer four Willingness to Pay (WTP) questions and are asked to allocate an amount of money (25 EUR) between themselves and two different carbon offsetting projects. This last WTP question is presented under three different treatments that provide different information about the permanence and the co-benefits of the specified offset project.
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Field
Sample size (or number of clusters) by treatment arms
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Before
Pre-test: Participants are evenly allocated to the treatment arms.
Main experiment: Currently, I plan to allocate participants equally to the treatment arms, but I will conduct a sample size estimation for the treatments based on the pre-test results. As a result, this allocation may change.
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After
Pre-test: Participants are evenly allocated to the treatment arms.
Main experiment: Participants are evenly allocated to the treatment arms.
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Intervention (Hidden)
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Before
Participants will be invited to take part in an online survey, for which they will receive a fixed participation fee (€10). They have the opportunity to get another 30€ plus 2€. The survey is structured in three elements:
1. Pre-experimental questionnaire: Consumers will answer questions related to their climate preferences, their carbon footprint, previous offsetting activities, as well as their beliefs about how well different carbon offset projects perform in terms of permanence and co-benefits. There are two bonus questions on social norms, based on which participants can earn 1€ for each correctly estimated social norm.
2. Willingness to pay (WTP): Consumers will be informed that they have the opportunity to receive an additional €30. Participants can freely decide whether they want to keep the €30 for themselves or use it (either entirely or in parts) to compensate for parts of their yearly carbon footprint. They will be informed that they will make a total of four different decisions regarding how to use the €30. Once the survey is completed, I will randomly select 10% of the participants and randomly implement one of their four decisions. This means that, depending on what participants indicated, I will transfer the additional money to their account or transfer it to an offset provider. As an experimental intervention, I will vary the information that participants receive with the fourth WTP question.
3. Post-experimental questionnaire: Consumers will answer survey questions about the motivations for their offsetting choices, how good they feel, how much they trust different institutions, and basic economic preferences (such as risk and altruism), as well as socio-economic information.
To test the design, a pre-test is planned for October/November 2023. After having evaluated the pre-test and run the power analysis based on the pre-test, the main experiment is planned to be implemented in December 2023 / January 2024.
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After
Participants will be invited to take part in an online survey, for which they will receive a fixed participation fee defined by the survey company. In addition, 10% of all participants have the opportunity to get another 30€ as part of the experimental incentivization. The survey is structured in three elements:
1. Pre-experimental questionnaire: Consumers will answer questions related to their climate preferences, their carbon footprint, previous offsetting activities, as well as their beliefs about how well different carbon offset projects perform in terms of permanence and co-benefits. There are two bonus questions on social norms, based on which participants can earn 2.5€ for each correctly estimated social norm.
2. Willingness to pay (WTP): Consumers will be informed that they have the opportunity to receive an additional €25. Participants can freely decide whether they want to keep the €25 for themselves or use it (either entirely or in parts) to compensate for parts of their yearly carbon footprint. They will be informed that they will make a total of two different decisions regarding how to use the €25. Once the survey is completed, I will randomly select 10% of the participants and randomly implement one of their two decisions. This means that, depending on what participants indicated, I will transfer the additional money to their account or transfer it to an offset provider. As an experimental intervention, I will vary the information that participants receive with the WTP questions.
3. Post-experimental questionnaire: Consumers will answer survey questions about the motivations for their offsetting choices, how good they feel, how much they trust different institutions, and basic economic preferences (such as risk and altruism), as well as socio-economic information.
To test the design, a pre-test is planned for October/November 2023. After having evaluated the pre-test and run the power analysis based on the pre-test, the main experiment is planned to be implemented in the first two weeks of February 2024.
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